Method and apparatus for negotiating a contract over a computer network

ABSTRACT

The invention provides a system and method that facilitates a structured contract negotiation between two parties, such as parties to a real estate transaction. A series of predefined milestone negotiation steps are executed on a computer that couples two parties through a network, such as the Internet. The negotiators answer predefined questions regarding a proposed transaction in such a manner that certain aspects of the transaction can be agreed upon early during the negotiation process while others are deferred to later phases. In each phase, each party selects from a predefined list of actions associated with a particular aspect of the negotiation (e.g., sale price). Third-party service providers such as brokers and architects can be automatically pulled into the negotiations using computer-issued requests for services.

This application is a divisional application Ser. No. of 10/042,245,filed Jan. 11, 2002, which is a continuation-in-part of U.S. applicationSer. No. 09/610,005, filed on Jul. 5, 2000.

BACKGROUND OF THE INVENTION

1. Technical Field

This invention relates generally to electronic commerce and theInternet. More particularly, the invention provides a method andapparatus for allowing two parties to negotiate and execute a contract,such as a real estate lease or a sale, over a computer network such asthe Internet.

2. Related Information

Corporations frequently need to lease real estate in the form ofoffices, laboratories, warehouses, and other spaces. Alternatively,companies sometimes have surplus office space that could be sublet totenants for profit or cost recovery.

Typically, companies will hire real estate brokers to search for andconduct preliminary negotiations regarding potential leasingarrangements. After preliminary details have been worked out, lawyersacting on behalf of the prospective landlords and tenants negotiate adetailed lease agreement. This process may involve numerous meetings,telephone calls, faxes, exchanges of draft documents, and the like. Italso may involve various middlemen in addition to lawyers and realestate brokers. For example, if architectural or mechanical improvementsare needed, one or both of the parties may hire outside contractors(e.g., architects or engineers) to assist in evaluation of leaseproperties and/or to propose modifications to the property.

Because of human nature and the typically unstructured methods by whichleases are negotiated, parties sometimes backtrack on previouslyagreed-upon provisions or demand changes to lease provisions that werepreviously believed to be the subject of agreement. Parties may spend alarge amount of time negotiating details of lease provisions that laterbecome moot (e.g., the leasehold improvements to the premises) becauseof disagreements over other provisions (e.g., term of the lease).Consequently, acquiring or leasing real estate in the corporate marketincurs large costs and time because of intermediaries and humaninteraction required to negotiate lease provisions.

Various web-based listing services have sprung up in recent years toservice the real estate needs of companies looking for space, includingsales, leases, and auctions. Companies such as Loopnet(www.loopnet.com), PropertyFirst (www.propertyfirst.com), andEGPropertyLink (www.egpropertylink.co.uk) provide brokerage and listingservices in an attempt to facilitate real estate transactions over theInternet. These services primarily focus on listing properties, and dolittle to facilitate the negotiation or consummation of real estatedeals. In particular, these services do not provide process managementtools to guide landlords and tenants through a structured deal.Furthermore, they do not provide a mechanism for monitoring the progressof a transaction after signature of the lease (e.g., completion of worksby landlord and tenant), nor do they provide any mechanism to integrateinto the process an evaluation of qualitative aspects of the transactionsuch as cross-border difficulties and delays, and the effectiveness oflocal service providers such as brokers and architects.

The negotiation of real estate leases between parties located indifferent countries involves additional inefficiencies and drawbacks.For example, because of different time zones, the times available forparties to meet or hold telephone conferences may be limited.Differences in currencies (e.g., dollars versus Euros) and metrics(e.g., square feet versus square meters) add complexity to thenegotiation process, thus driving up costs. Language barriers may alsoadd additional costs.

It may be difficult for a U.S.-based prospective tenant to hire outsidecontractors, such as architects, in another country. Furthermore, theprocedures and customs used by foreign real estate brokers andintermediaries to negotiate a corporate lease may be different dependingon the country, language, and regulations. Legal documents drafted inone country may look substantially different from those typicallydrafted under U.S. laws and customs. These and other differences havemade it very costly to negotiate leases for commercial office spaceacross international borders.

More generally, negotiating contracts of various types, such as acorporate procurement contract or a contract related to supply-chainmanagement applications, can incur many of the disadvantages andinefficiencies discussed above. Consequently, there exists a need tostreamline the process by which prospective parties to a contract cannegotiate and consummate a contract.

SUMMARY OF THE INVENTION

The present invention overcomes the aforementioned problems by providinga structured method and apparatus for allowing prospective parties to acontract to negotiate and consummate the contract.

In one embodiment, the method facilitates a structured lease negotiationbetween two parties to a real estate transaction. A series of predefinedmilestone negotiation steps are executed on a computer that couples twoparties through a network, such as the Internet. Parties to thetransaction answer predefined questions regarding a proposed transactionin such a manner that certain aspects of the transaction can be agreedupon early during the negotiation process while others are deferred tolater phases. Additional steps of completing the lease transaction canalso be included in the inventive method.

In one variation of the invention, the parties answer questions andexchange information without the simultaneous participation of eachparticipant, such that a structured negotiation takes place over aperiod of time, possibly in different time zones. In each phase, partiesmust select from a predefined list of actions (e.g., agree or defer)associated with a particular aspect of the negotiation (e.g., rent to becharged, term of the lease, etc.). Provisions to which both partiesagree are “locked in” while those that are deferred are worked out in asubsequent phase. Certain lease provisions may have subsidiary actions(e.g., lower-level agreements and deferrals) that can then be “rolledup” to the phase-level negotiation. Tools are provided to facilitatetransnational aspects of the negotiation (e.g., conversion betweencurrencies, metrics, or languages). A computer generates intermediatedocuments that assist in the negotiation (e.g., draft proposal letters)and identifies areas that require further negotiation.

If parties indicate that outside help is needed to define part of thecontract (e.g., architect review of an office layout), a computersuggests vendors located in the geographic area of the lease propertyand transmits via e-mail a draft scope of services request to one ormore vendors. Each party identifies corporate approvals required tocomplete the negotiation, and a computer-generated lease document can beprinted for signatures. Feedback from the parties in the form ofproblems encountered and solutions achieved during the negotiationprocess are collected and stored in a database for review and use byother future negotiation parties.

Although the method and apparatus as described above are applicable tonegotiating real estate transactions such as the sale of real estateproperties, certain additional features are included in acontinuation-in-part embodiment to facilitate certain sale-specificcharacteristics. For example, details of the actions taken in each phasecan be adjusted to accommodate sale-specific terms and conditions.

More generally, the inventive principles can be used to provide acomputer-implemented method of reaching agreement between two partiesconcerning a contract of any type, such as a corporate procurementcontract or a contract related to supply-chain management applications.

Additional improvements include: (1) rules-based agreement onnegotiator-supplied terms (response and dialogue box); (2) delegation totransaction team members or service providers; (3) summary reports withlink to messaging system; (4) a dual messaging system; (5) customizednegotiation process; and (6) sale-specific features.

Other features and advantages of the invention will become apparent withreference to the following detailed description and the figures.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1A shows a system for facilitating a real estate lease transactionbetween a prospective tenant and prospective landlord using acomputer-driven structured negotiation technique.

FIG. 1B shows a computer-implemented method for allowing two parties tonegotiate a lease transaction using structured negotiation phases.

FIG. 2 shows a nine-phase computer-assisted process for negotiating andexecuting a lease transaction between a tenant and a landlord.

FIG. 3 shows additional details of the first phase.

FIG. 4 shows additional details of the second phase.

FIG. 5 shows additional details of the third phase.

FIG. 6 shows additional details of the fourth phase.

FIG. 7 shows additional details of the fifth phase.

FIG. 8 shows additional details of the sixth phase.

FIG. 9 shows additional details of the seventh phase.

FIG. 10 shows additional details of the eighth phase.

FIG. 11 shows additional details of the ninth phase.

FIG. 12 shows a web-based computer screen presenting top-level choicesfor each phase of a nine-phase negotiation and execution process.

FIG. 13 shows a web-based computer screen in which a prospective tenantand landlord select predefined choices for lease provisions in a firstphase.

FIG. 13A shows an alternate web-based computer screen according to acontinuation-in-part improvement including dialogue boxes for eachnegotiator.

FIG. 14 shows a web-based computer screen for negotiating details of onelease provision.

FIG. 15 shows a web-based computer screen in which a prospective tenantand landlord select predefined choices for resolving deferred leaseprovisions in a second phase.

FIG. 16 shows a computer-generated lease proposal to be filled in by oneor both of the parties.

FIGS. 17A and 17B show a computer-generated preview of a lease proposalto be agreed between the parties.

FIG. 18 shows a computer-generated schedule for each phase of anine-phase lease negotiation and execution process.

FIGS. 19A and 19B show a computer-generated request for proposal for alocal service provider.

FIG. 20 shows a web-based computer screen for designating members of atransaction team.

FIG. 21 shows a plurality of transactions in summary form with a linkageto a messaging system.

FIG. 22 shows a message transmission screen for sending messages to acurrent contact associated with a lease.

FIG. 23 shows a message transmission screen for sending messages to aperson that plays a particular role in the lease negotiation process.

FIG. 24 shows another variation of a summary report, breaking outvarious information for each phase of a transaction.

FIG. 25 shows a message log visible to members of a transaction teamshowing messages that have been sent to parties negotiating a realestate transaction.

FIG. 26 shows a nine-phase negotiation process that can be used tonegotiate a sale of real property between a buyer (or buyer's agent) andseller (or seller's agent).

FIG. 27 shows various decisions that can be made during a first phase ofa sale negotiation.

FIG. 28 shows lower-level sale price decisions corresponding to decisionelement 2101 in FIG. 21.

FIG. 29 shows various decisions that can be made during a second phaseof a sale negotiation.

FIG. 30 shows various decisions that can be made during a third phase ofa sale negotiation.

FIG. 31 shows various decisions that can be made during a fourth phaseof a sale negotiation.

FIG. 32 shows various decisions that can be made during a fifth phase ofa sale negotiation.

FIG. 33 shows various decisions that can be made during a sixth phase ofa sale negotiation.

FIG. 34 shows various decisions that can be made during a seventh phaseof a sale negotiation.

FIG. 35 shows various decisions that can be made during an eighth phaseof a sale negotiation.

FIG. 36 shows various decisions that can be made during a ninth phase ofa sale negotiation.

FIG. 37 shows a draft proposal for a sale of assets or property.

DETAILED DESCRIPTION OF THE PREFERRED EMBODIMENTS

FIG. 1A shows a system for facilitating a real estate lease transactionbetween a tenant and a landlord. Although the terms “landlord” and“tenant” will be used generally to refer to actual parties to a leasenegotiation, those terms also encompass agents or others acting onbehalf of the ultimate landlord or tenant. It is also possible thatthere will be more than one landlord or tenant to a transaction. Itshould also be understood that a tenant in one context could in fact actas a landlord in another context. For example, a tenant that needs todispose of part of a leasehold interest could be considered a landlordin the context of the invention. A landlord having an existing leasewith a tenant may act in concert with the tenant to sublet the propertyto another tenant; in that context, the landlord and original tenantcould both be considered landlords while the prospective new lesseewould be the tenant. In summary, the terms “landlord” and “tenant” mayhave a variety of meanings dictated by the particular context.

According to the system of FIG. 1A, a prospective tenant operates acomputer 101 to negotiate a real estate lease with a prospectivelandlord, who operates a separate computer 102. The parties negotiatethe lease through a computer 100 that implements a structuredtransaction. Computer 100 may comprise a web site that stores andgenerates web pages accessible over the Internet to both parties, eachof whom may be located in different countries and time zones.Additionally, one or more vendor computers 108 may also communicate withcomputer 100 as described in more detail herein. Alternatively, thefunctions associated with computer 100 can be implemented in computer101 or 102, or a combination of the two computers, such that no physicalthird computer is required.

According to one aspect of the invention, each lease is negotiated usinga computer-implemented process that guides the parties through variousnegotiation phases. Although the invention will be described withreference to a nine-phase negotiation and execution process, theinvention is not limited in this respect, and it will be appreciatedthat a different number of negotiation phases can be used withoutdeparting from the scope of the invention. Any or all of the stepsdescribed herein can be implemented in software and stored oncomputer-readable media for execution in a computer.

In one embodiment, a structured transaction engine 103 controls thenegotiation process by displaying web pages containing predefinedchoices for various aspects of the transaction within each negotiationphase, and by comparing choices made by each party on each web page torules stored in a rules database 105. Rules database 105 and engine 103can comprise an expert system or other type of knowledge base thatstores information concerning allowable inputs from each user for eachphase. Alternatively, the logic used to control the operation of thenegotiation (and to flag errors or conflicting information entered byusers) can be incorporated into software using a procedural orobject-oriented language.

Structured transaction engine 103 stores information entered by eachparty into a lease transaction database 104, which maintains informationconcerning each evolving lease negotiation. Multiple leases maysimultaneously be under negotiation at any one time among different setsof negotiators, such that lease transaction database 104 containsinformation for different leases in various stages of negotiation.Vendor database 106 contains information concerning various third-partyvendors (e.g., architects, engineers, lawyers, interior designers, andthe like) and their associated contact information (e.g., city, country,e-mail address, telephone and fax number). Document database 107contains certain standard document templates that can be used toconstruct a completed lease and other intermediate documents based oninformation provided by the parties during the negotiation process.

One or more converters 109 provide conversion functions (e.g., Euros todollars, square feet to square meters, and vice versa) to facilitate thenegotiation of particular aspects of each lease. An e-mail service 110can also be included to allow parties to a negotiation to transmit andreceive messages, including attachments such as draft documents, duringthe negotiation process. Schedule calculator 111 calculates a proposedschedule corresponding to milestones during the negotiation andexecution phase, based on average actual lengths of time stored in adatabase. In one variation, the lengths of time stored in the databaseare based on or derived from previously negotiated contracts (i.e.,real-world practice is used to project future schedules). For example,if over the course of five different negotiated leases the averageamount of time needed to go from generating a draft lease to moving intothe leased property is two months, the scheduler would use that value toschedule such a milestone two months before the lease move-in date.

In accordance with one aspect of the invention, the parties answerquestions presented on web pages according to a computer-implementedtransaction sequence, such that the parties can quickly identify areasof agreement and resolve areas of disagreement in an efficient manner.The lease negotiation can be conducted across great distances (e.g.,across the Atlantic Ocean) and in different time zones through the useof a computer network such as the Internet. Because both parties areforced to conform to a highly structured, well-defined transactionsequence for negotiation, errors and misunderstandings can be greatlyreduced. Moreover, computer software can be used to quickly identifyareas of agreement and offer alternatives for resolving areas ofdisagreement.

FIG. 1B shows a computer-implemented method for negotiating a leasetransaction using structured negotiation phases. As shown generally inthese figures, each party can independently log into a web-basedtransaction management system (e.g., computer 100 of FIG. 1A) andnegotiate lease terms by selecting choices from transaction displayscreens. In one embodiment, parties are prevented from advancing to thenext negotiation phase unless the computer detects that each user haseither agreed to a specific lease term, or that each user has elected todefer agreement on a term until a later negotiation phase.

Each lease provision can be negotiated by taking one of severalpredefined actions. In one embodiment, at each top-level negotiationphase, a party must either AGREE or DEFER on each lease provision (e.g.,by selecting a choice or clicking on an icon representing a choice).Each of these choices in turn can result in or derive from lower-levelactions by involving lower-level decisions. In other words, before aparty is prepared to AGREE or DEFER on a lease provision, lower-leveldecisions involving steps of mediation, issuance of third-party requestsfor assistance, or other types of actions may need to be taken. Theselower-level decisions can be reached using additional computer screensthat are linked to one or more of the higher-level screens.

More generally, the negotiation, execution and evaluation of a lease canbe accomplished according to one aspect of the inventive principlesusing a reduced instruction protocol that facilitates and acceleratesmilestone decisions associated with the transaction. Such a protocolprovides numerous benefits because, among other things:

-   (a) The lease transaction process is complex and can involve    numerous participants and, in a cross-border context, these    participants will most likely reside in different countries;-   (b) There are varying degrees of skill among the representatives of    the landlord and tenant and, in a cross-border context, varying    levels of understanding of their respective roles and    responsibilities;-   (c) In a cross-border context, there are language problems, local    knowledge gaps and cultural differences that can slow down    negotiations;-   (d) In a cross-border context, a computer application for this    process functions best when it prescribes a clear set of top-level    decisions (milestones) with a mechanism for coordinating the roles    and actions of those who participate in reaching these decisions.

One embodiment of the protocol includes the following three elements,although other embodiments incorporate fewer than all three elements:

1. Decision Protocol

The parties must either agree or defer to all milestone decisions. Thisacknowledges that milestones are critical to completing the project, andthat it is important to avoid the dead-end implied by using the word“no” (which is considered impolite or is non-existent in some cultures).The computer provides a facility for either agreeing or deferring oneach milestone decision. In addition, displayed with each milestonedecision is a dialogue box to enter a comment, or an icon to indicatethat a comment has been entered and will be visible on another screen.Predefined actions in this category include:

Agree: a party acknowledges that a milestone decision has been reached(e.g., agreement on a specific monthly rent).

Defer: a party agrees to defer a milestone decision to a later date(e.g., defer a decision on the condition of the premises).

2. Resolution Protocol

Assuming that all milestone decisions must be agreed to complete theprocess, an additional mechanism can be used to convert deferrals intoagreements. Therefore, the protocol provides three resolutionmechanisms, including: (a) a user forum; (b) use of a Local ServiceProvider (LSP); or (c) mediation. The computer facilitates selection ofLSP's or mediators (via menus of service providers, issuing scopes ofservices, etc.), and schedules meetings among the participants in thesedecisions. Three corresponding predefined actions in the resolutionprotocol category include:

Forum: the transaction parties (i.e., the landlord and tenant) meet in astructured environment (e.g., scheduled by computer) to agree on amilestone decision.

LSP: the parties agree to select a third party local service provider orproviders (e.g., an architect) to facilitate reaching a milestonedecision.

Mediate: the parties agree to select a neutral expert to facilitatereaching a milestone decision.

3. Action Protocol

The computer prescribes a sequence of milestone decisions to completethe process. For some milestones, additional work must be done to reachan agreement or deferral. The protocol streamlines this work into aprescribed set of actions that are required of the participants (i.e.,the landlord, tenant, and LSPs), and which can be undertaken withcomputer assistance. The computer acts as an engine to provide adequateinformation and resources on the desktop of the landlord and tenant.Examples include distributing documents such as draft leases; issuingstandardized documents such as Requests For Proposals (RFPs),specification of leasehold improvements, etc; notifying parties if anyschedule dates have been missed or any input errors have occurred; andscheduling meetings among the participants.

In addition, the computer can prompt the participants about certainelements in the process. Examples include prompting the parties toidentify resource persons; prompting the parties to negotiate certainaspects of tenant's physical environment; and prompting the parties toobtain signatures to certain documents.

It is anticipated that the computer can provide additional assistance inthe more restricted roles by suggesting various courses of action. Forexample, if the parties had not resolved the delivery of the tenant'sspace on a “turnkey” basis, the computer could suggest that the partiesagree to split the cost of the improvements above the landlord's“building standard” on a 50/50 basis. More generally, the computer candraw upon a library of potential solutions based on past practice tosuggest resolution to certain milestone decisions or sub decisions. Thisfacility could be visually displayed alongside any required futureaction. Examples of predefined actions in this action category include:

Identify: the computer prompts the parties to locate an appropriateinternal resource person or entity. For example, prompt to identifyauthorized signatory for lease.

Issue: the computer issues a standardized document to the parties or toLSPs. For example, the computer can issue a request for proposals to oneor more architects.

Notify: the computer sends a notice to the parties and/or LSPs ifactions are erroneous or milestones are not completed by the scheduleddates. For example, the computer can notify the parties that a scheduleddate for signature of lease has been missed.

Obtain: the computer prompts the parties to generate information frominternal resources. For example, the computer can prompt the parties toobtain approvals for lease.

Provide: the computer prompts the parties as to generally submitinformation in support of a milestone decision. For example, thecomputer can prompt a party to submit a preliminary cost estimate forleasehold improvements.

Require: the computer can ask the parties whether they requirestandardized documents to assist in reaching milestone decisions. Forexample, the computer can ask the parties whether they require a brokerRFP.

Receive: the computer receives and subsequently transmits in a summaryform documents from third parties. For example, the computer can receiveand transmit a response to a broker RFP.

Resolve: the computer prompts the parties or an LSP to reach agreementon detailed matters related to third party documents. For example, thecomputer can prompt parties to resolve outstanding provisions of leaseagreement.

Schedule: the computer arranges meetings in a format chosen by partiesand/or LSPs. For example, the computer can schedule a user forum toagree on outstanding lease issues.

Send: the computer transmits documents to parties. For example, thecomputer can transmit a draft lease to one of the parties or LSPs.

Select: the computer prompts the parties to make choices amongalternatives provided on a screen or box. For example, a computer canprompt a party to select a mode for a user forum.

It will be appreciated that the above examples of predefined actions areexemplary only; different labels or actions can be specified, and eachaction can be selected using a pictographic icon or other means tofacilitate communication across languages (e.g., a handshake icon tosignify agreement on a lease provision).

In addition to selecting a pre-defined response such as one selectedfrom the above choices, each party may also in certain circumstancesenter ancillary information that is associated with and stored with theresponse. For example, if one party suggests a delivery date of October1 for a leased property (and indicates AGREE for that date), the otherparty may instead suggest a delivery date of November 1 for theproperty. If both parties have selected AGREE but have entered differentvalues, the computer would flag the discrepancy and possibly suggest asolution (e.g., split the difference). Alternatively, a single textentry box could be provided, and each party could override the other'sentry, with the computer flagging any overridden value (and, in oneembodiment, changing the first party's AGREE choice back to a defaultvalue or some other choice).

If both parties select the same response (e.g., one of the responsesselected from the above list), then the agreed status of the particularlease term is deemed to be “locked in” and not subject to furthernegotiation. This is intended to facilitate the negotiation status bypreventing parties from “back-tracking” to items that were previouslythe subject of agreement. However, the invention is not limited in thisrespect, and certain variations of the invention include allowing usersto change previously matched responses.

Beginning in step 120 of FIG. 1B, the parties independently log into thesystem (e.g., using a user name and password). A user can include aparty to the negotiation (e.g., a landlord or tenant), although it couldalso include agents or others acting on behalf of principals to thenegotiation. In step 121, if a user is not recognized, then in step 122,user registration information (e.g., name, address, e-mail address, andthe like) is obtained. In step 123, a check is made to determine whetherthe user seeks to negotiate a new lease or continue negotiating apreviously started lease.

If a new lease is selected, then in step 124 a new negotiation file isestablished, and each user can select options such as the currency touse for displaying negotiation information and metrics (e.g., squarefeet or square meters). In one variation, a prospective tenant andlandlord can choose to view the information in different formats, suchthat the tenant views the rent in dollars and the landlord views therent in Euros, for example. Currency and metrics converters (function109 in FIG. 1A) are used to automatically convert between units enteredby the users based on currency exchange rates. In another variation,values are shown simultaneously in two formats (e.g., square meters andsquare feet), and the parties can select what formats are to bedisplayed (e.g., dollars and Euros simultaneously, or dollars and Frenchfrancs simultaneously). It is assumed that currency exchange informationis stored in a database or accessible over a network such as theInternet.

If negotiations regarding a previously started lease are to be resumed,then in step 125 computer 100 retrieves previously stored negotiationinformation from database 104. In step 126, each user (i.e., each tenantand landlord) selects a negotiation phase and enters choices fordecisions to be reached during each phase. According to the invention,each party can log on independently and at different times to negotiatethe lease, so that it is not necessary to have simultaneousparticipation by the parties. Of course, it is possible that the partiesmight log in at overlapping times, and in such a case the system canprevent both users from modifying the same data at the same time (e.g.,using file or database locks, for example).

Step 126 can involve subsidiary steps of negotiating particular aspectsof a lease provision before agreement or deferral on the provision isreached. For example, before a party is prepared to agree to a leaseprovision defining the condition of the premises, several sub-decisionsmay be involved, such as determining what types of electrical systemswill be provided, what type of security system is included, etc. Theseprovisions can be negotiated using lower-level computer screens thatinvite the user to make selections based on pre-defined choices. In oneembodiment, the computer indicates to the user that sub-decisions areinvolved, and prompts the parties to ensure that such sub-decisions areaddressed. Alternatively, if the tenant has for example agreed to takethe premises in “as-is” condition, these lower-level decisions will beunnecessary, and the computer can avoid prompting the tenant for thesechoices.

If in step 127 a user specifies that he or she is done enteringinformation, then processing advances to step 129. At various pointsduring the process, each user may optionally choose to generate one ormore intermediate documents (e.g., a draft lease proposal or the like)depending on the negotiation phase in which the user is participating(see step 128). Further details of this optional step are providedbelow.

In step 129 the computer checks to determine whether all of the choicesselected by the user in the negotiation phase are either AGREE or DEFER.If so, then in step 130 another check is made to determine whether theother party has also selected choices for the particular negotiationphase. If not, then in step 133 an e-mail message or other notificationis transmitted to the other party inviting that party to review theresponses provided by the first user. If further explanation isrequired, the computer can provide a summary of the phase with somefrequently asked questions. Additionally, the computer can provide acomment or dialogue box for each phase to facilitate directcommunication between the parties. Processing then either terminates orreturns to a previous step (e.g., step 125 of FIG. 1B).

If in step 130 the other party to the negotiation has also selectedchoices for the particular negotiation phase, then in step 131 a checkis made to determine whether all of the choices specified by the otherparty are either AGREE or DEFER. If not, then in step 134 an errormessage is generated and solutions are suggested. For example, if oneparty has selected AGREE for a particular lease provision but the otherparty has selected DEFER, the computer can suggest that the agreeingparty DEFER the decision until the next negotiation phase. As anotherexample, if one party has agreed to $5,000 per month rent but the otherparty has agreed to $6,000 per month rent, the computer can flag thediscrepancy and suggest a compromise rent of $5,500 per month.

Alternatively, a single text box can be provided for entering a valuesuch as rent, thus allowing each party to override the other's value. Inone variation, the computer would then change the choice of the partywhose value was overridden from AGREE to undecided or some other choiceand generate a message indicating that the first party had changed thevalue. In yet another embodiment, if the two parties had agreed ondifferent amounts, the computer would change both AGREE choices toDEFER, such that the decision would be deferred to a later negotiationphase.

If in step 131 both parties have selected either AGREE or DEFER for alllease terms pertaining to the particular negotiation phase, then in step132 the agreed terms are deemed “locked in” by the computer and notsubject to further change; all those for which the parties haveindicated DEFER are deferred by the computer until a later negotiationphase. Thereafter, in step 135 the user is permitted to advance to thenext negotiation phase (e.g., one of the nine negotiation phases shownin FIG. 2). The previous steps beginning at step 126 are then repeatedfor each phase until the negotiation has been concluded.

Assuming in step 129 that the user did not choose either AGREE or DEFERfor each item in the negotiation phase, then an error message isgenerated, and processing returns to step 126. It will be appreciatedthat options other than AGREE or DEFER can be provided without departingfrom the scope of the invention. Moreover, graphical icons (e.g., ahandshake symbol instead of an AGREE choice) can be used. Choices canalso be shown in different languages to the different parties, such thatone party to the transaction sees choices in English while the otherparty to the negotiation sees the same choices in Spanish, for example.

FIG. 2 shows a generalized nine phase computer-assisted process fornegotiating, executing, and evaluating a lease transaction according toone variation of the invention. As explained above, in one embodimenteach party is required to select agreement or deferral of certain leaseprovisions before the computer will allow the users to advance to thenext negotiation phase. Selection of other choices for lease provisionswithin a negotiation phase may require ancillary communication (e.g.,transmission of requests for services) or processing (e.g., submissionof information). Web-based computer forms, such as those shown in FIGS.13 through 15, can be used to select choices relating to leaseprovisions. Certain phases (e.g., 201 through 206) generally relate tothe negotiation of a lease; other phases (e.g., 207 and 208) relate toexecution of the lease, and a final phase (209) relates to evaluation ofthe completed lease transaction.

As shown in FIG. 2, a first phase 201 includes steps of confirming alease proposal and obtaining agreement upon a lease schedule (e.g.,delivery date). This phase is preferably conducted through the use ofweb-based computer display forms having appropriate selection means(e.g., radio buttons, check boxes, text boxes, pull-down menus and thelike) that allow each user to enter and view information for theparticular phase. Further details of one possible embodiment areprovided below.

A second phase 202 includes steps of resolving outstanding businessissues, wherein users are presented with a checklist of outstandingissues deferred from the first phase and prompted to develop solutionsto these issues. A third phase 203 includes steps of obtaining agreementon lease deliverables (e.g., condition of the premises, furnishings,telecommunication systems, etc.). A fourth phase 204 relates to definingthe tenant environment (e.g., preliminary floor plans, furniture, etc.).In this phase, the tenant defines his or her requirements to occupy thepremises, including improvements and investments not provided by thelandlord (which are typically included in the third phase). In thefourth phase, the landlord may or may not be involved in decisionsregarding specification of furniture, network, and telecommunicationsystems, for example.

A fifth phase 205 relates to agreement on legal documents, including astep of generating a draft contract. A sixth phase 206 relates toobtaining approvals and execution of the lease documents, includingsteps of submitting forms for corporate approvals, paying deposits, etc.A seventh phase 207 relates to completing landlord works (e.g., landlorddelivers landlord-supplied network system and leasehold improvements).An eighth phase 208 (completion of tenant works) includes steps such asdelivering tenant-supplied furniture and telecommunications systems.This may include the use of contractors such as architects andengineers, and may or may not involve the landlord.

In the seventh and eighth phases, it is generally contemplated that thecomputer will perform a monitoring function of the scheduled dates fordelivery of works as anticipated in the schedule, with a communicationfunction in the event that scheduled dates are missed and a function toissue a standardized form for acceptance of works performed by thelandlord and/or LSPs. Turning briefly to FIG. 18, a computer-generatedschedule incorporating the major milestone phases is shown. In oneembodiment, the computer generates such a schedule by using the leasemove-in date as a starting point and “backing out” dates for earliermilestones using either default values or values retrieved from adatabase based on historically experienced lease transactions. As eachdate is reached, the computer can prompt the parties to agree that aparticular phase has been completed, and can transmit a message to eachparty warning of upcoming delays if the phase is not completed. Althoughmost milestones can be assumed to have a linear dependency (e.g., legaldocuments cannot be finalized until the lease proposal is agreed), it isalso possible that certain milestone decisions can be deferred untillater phases, such that a schedule slip in one milestone does notnecessarily result in slippage for all remaining milestone decisions.

A final ninth phase (issue best practice report) includes steps ofevaluating local service providers and preparing a best practice report,which is preferably stored in a database for future reference.

The following description, in conjunction with FIGS. 3 through 11(details of each negotiation phase) and FIGS. 12 through 15(computer-implemented forms that solicit information for each phase),explains one possible approach for implementing a method and systemaccording to the present invention. It will be assumed that prior toperforming the steps shown in FIG. 3, a user has logged into the systemand, if pertinent, reviewed e-mail messages in his/her account that werereceived from other users, such as another party to the negotiation. Itwill also be assumed that a web-based computer display system usingwell-known hyperlink technology is used to solicit and displayinformation between parties, although the invention is not limited inthis respect.

Turning first to FIG. 12, a top-level project negotiation phaseselection page is presented to the user after the user logs in andidentifies himself or herself. If a user is beginning a new negotiation,then a separate computer screen (not shown) is displayed to solicitinformation concerning the parties and the subject of the negotiation.Otherwise, if a previous negotiation has already been started, the usercan enter the project number or name into a text box 1201 and the systemwill retrieve previously stored information regarding the lease. Atop-level selection list 1202 contains hyperlinks to web pagescorresponding to each of the nine negotiation phases identified on FIG.12 (and also identified in FIG. 2) and would highlight the current phasethat is in negotiation. As an alternative to the hyperlinked displayscreens described below, each party can fill out a “short form” leaseproposal of a type shown in FIG. 16, and the computer can identify anydifferences between the choices selected by the two parties and focus onthose areas of disagreement.

Although the user can jump directly to any negotiation phase, it iscontemplated that each user will progress sequentially through thephases, and that users will be prevented from jumping ahead to laterphases until agreement has been reached on lease provisions in eachphase. Assuming that the user has not previously negotiated any of thelease provisions, the user would click on the first phase (Confirm LeaseProposal and Agree Schedule), which would cause the computer to displaya screen such as the one shown in FIG. 13.

FIG. 13 shows a web-based computer screen in which a tenant and landlordselect predefined choices for lease provisions according to a firstnegotiation phase. This figure will be explained with reference to FIG.3, which shows computer-implemented steps that can be used to negotiatebetween parties during a first phase of a lease negotiation. The stepsneed not be executed in sequential order as illustrated in FIG. 3. Forthe sake of simplicity, only four lease provisions are shown in FIG. 13even though FIG. 3 shows 9 separate provisions. It should be understoodthat the illustrated lease provisions are by no means exhaustive orexclusive.

In general, for each negotiation phase the parties are presented with aset of provisions related to the lease or leased premises, and a set ofchoices (e.g., AGREE or DEFER) for taking action on each provision. Forcertain lease provisions, the parties must not only indicate agreement,but must agree on a specific value or values (e.g., the amount of rentto be charged). In some cases, agreement cannot be reached withoutnegotiating lower-level details. In those cases, thecomputer-implemented method permits the parties to jump to thelower-level decision-making process before committing to an AGREE orDEFER at the higher level of the negotiation phase. Where a leaseprovision is deferred, the provision can be negotiated during a laterphase by selecting choices other than AGREE or DEFER (e.g., resolutionprotocol actions such as user forum, LSP, or mediation).

As shown in steps 301 through 309 of FIG. 3, each party is asked toagree upon certain lease provisions (and, where appropriate, to specifycertain information such as rental price). Although these steps areshown as sequential in FIG. 3, each user could of course select thechoices and enter information in an order different from that shown. Inone embodiment, however, a user is prevented from advancing to the nextphase of negotiation until all provisions are either agreed to by bothparties or any areas of disagreement are indicated as being deferred.

As shown in FIG. 13, four different lease provisions 1301 through 1304are arranged on the left side of the computer screen. A HELP linkage1314 can be provided for each lease provision to explain common leaseprovisions and to answer frequently asked questions. The right side ofthe screen in FIG. 13 is divided into a tenant portion, a landlordportion, and a middle portion in which either party can enterinformation. In general, it is anticipated that when the tenant logsinto the system, the tenant will only be able to select or modifychoices listed under TENANT and values in the middle portion of thescreen. Conversely, the landlord can only select or modify choiceslisted under LANDLORD and the values in the middle portion of thescreen. Each party specifies one or more values in the middle portion ofthe screen, optionally indicates comments in one or more comment boxes1312, and clicks a DONE button 1306 to signify that they have completedtheir responses for each negotiation phase.

In general, each tenant and landlord must select either AGREE or DEFERfor each lease provision. Before selecting a choice for a particularlease provision, the party can “drill down” to a lower-leveldecision-making process by clicking on an associated DETAILS hyperlink1311, which would bring up a page such as that shown in FIG. 14.Suppose, as shown in FIG. 13, that both parties have agreed to arequired space provision of 5000 square feet (automatically convertedinto square meters by the computer); a delivery date of Jun. 1, 2000;and a lease term of 3 years. Suppose further that the parties haveagreed to defer agreement on the amount of rent (although a proposedrent amount is listed, and the tenant has added a comment to comment box1313). As to the landlord's works (not explicitly shown in FIG. 13), theparties do not have enough information to agree or defer to the nextstep. In that case, one or both of the parties could click on theassociated DETAILS link, which would bring up the screen shown in FIG.14.

Turning to FIG. 14, the parties are presented with a set of lower-leveldecisions concerning the landlord's works lease provision. As shown inFIG. 14, agreement on a landlord's works includes deciding whether thepremises are to be delivered on a “turnkey” basis 1401; “as-is”condition 1402; a definition of the landlord's works 1403; and agreementon the landlord's and tenant's contribution to the work 1404. A helpbutton (not shown) can be included to explain the decision and provide areference to local market practice in a particular city.

Some of these sub-provisions require nothing more than an AGREE or DEFERdecision (e.g., 1401 and 1402), while others (e.g., 1403 and 1404)require that a value be provided by one or the other party (e.g.,elements 1406 and 1407). Each party can select choices as shown in FIG.14 before selecting DONE and returning to the top-level lease provisionscreen shown in FIG. 13.

During the negotiation phases, either party can choose to view a draftlease proposal by clicking on VIEW LEASE PROPOSAL button 1305. Inresponse, the computer generates a draft lease proposal incorporatingthe lease provisions that had so far been agreed to by the parties. Oneexample of this is shown in FIGS. 17A and 17B. As a practical matter,after the lease has been negotiated (e.g., step 206 of FIG. 2), thelease proposal would be superseded by the actual lease.

As shown by the steps in FIG. 3, additional lease provisions includinglease term, tenure, landlord works (e.g., “as is” condition or “turnkey”basis), other improvements, other conditions (e.g., parking, operatingexpenses, termination condition, etc.), and draft schedule can also beagreed to, deferred, or negotiated using the above-described process.

Assuming that both parties have selected either AGREE or DEFER for eachlease provision and click DONE, the computer will advance to the nextnegotiation phase, which will now be explained with reference to FIG.15. If the parties have not selected either AGREE or DEFER for all leaseprovisions in the first negotiation phase, then in one variant of theinvention they will be prevented from advancing to a later negotiationphase. In certain variations of the invention, however, the parties areallowed to defer lease provisions such as the condition of the premisesuntil successively later phases; at each later phase, the parties areprompted to resolve any outstanding issues.

FIG. 15 shows a computer screen with choices for a second negotiationphase. As shown in FIG. 4, in one variation of the invention the secondphase includes steps of presenting a checklist of outstanding issuesthat were deferred from the first phase, and soliciting inputs from theparties that will allow the parties to reach agreement on the deferredissues using, for example, a local service provider (LSP) or mediator.Because the amount of the rent was deferred from phase one (see FIG. 13,lease provision 1303), this lease provision is again presented to theparties (item 1501 in FIG. 15) with options for resolving the issue. Inone variation of the invention, an issue can be resolved directly by theparties, or by involving a third party. The parties may choose forexample to resolve the rent issue in a user forum 1502, such as anon-line or off-line meeting (choices 1505). If both parties agreed tosuch a resolution, the computer would assist in arranging an on-line oroff-line meeting (e.g., by asking the parties for available times;accounting for time zone differences, etc). The computer could arrange achat-room dialogue in an on-line forum or a conference call using acomputer-aided program and may include a link through another web site.

Alternatively, the parties may choose to resolve the issue using a localservice provider 1503. Two examples of local service providers relevantto the issue of rent might be a real estate broker in the area of theleased property or an appraiser. As indicated in FIG. 15, the partiesmay agree to hire a broker (choice 1506), and the computer could suggesta broker in the geographic area of the leased property. The parties mayfurther choose whether to hire a separate broker, or to jointly hire abroker to advise both parties as to local practice (not explicitlyshown). As indicated in comment box 1508, the tenant has suggested thatthe broker should research average rents in the leased area to helpresolve the issue (see below).

As yet a third option, the parties may agree to resolve the issuethrough the use of a mediator 1507. In that case, the computer can againsuggest one or more mediators familiar with the type of leasetransaction and convenient to one or both of the parties. Additionalcomputer screens (not shown) can be presented to the user to obtaininformation necessary to consummate the third party relationship. Thecomputer would issue a request for proposals for the requiredassistance.

The negotiation options presented by the computer can be tailored to thespecific lease provision that is the subject of dispute. For example, ifthe parties are stuck on the subject of the condition of the leasedproperty (e.g., the type of network communication system that will beprovided), the computer would suggest a service provider familiar withtelecommunication systems, such as an engineering consultant or acompany that specializes in providing networks. As another example, ifthe parties have not reached agreement on a floor plan, the partiescould enlist the services of an architect or interior designer, againwith computer-generated requests for proposals with the required scopeof services (see, e.g., FIGS. 19A and 19B).

If the parties agree that a local service provider is to be hired, thecomputer system can recommend one or more providers based on thegeographic area of the lease (see FIG. 1, vendor database 106).Alternatively, a party may individually choose to hire a local serviceprovider without the assent of the other party (e.g., an architect), andthe system can recommend one or more service providers in the samemanner. In one embodiment, the system generates a preformatted requestfor services using information obtained during the negotiations (e.g.,name/address of the tenant, information concerning the leased space,etc.) and transmits the request to one or more vendors in order toreceive a quote for services. The request can be transmitted via e-mailor fax by the computer system, and each vendor can submit a bid orresponse to the party or parties requesting the services. The computercan receive responses in a standardized format and transmit to theparties a comparison of the proposals if more than one vendor wereselected. In one variation, vendor database 106 includes informationconcerning ratings or quality marks for specific vendors based on priorexperience with other parties. Consequently, the parties can make aninformed decision regarding potential third-party service providers.

Resolving issues using an LSP can be done through on-line web-basedconference calls, e-mail, telephone calls, and/or in-person meetings.Resolving issues without the use of an LSP can be done using the sametechniques.

After the issues are resolved by the parties, the parties enter theresolved information into the computer (using, for example, the computerform of the type shown in FIG. 13) and the computer stores the revisednegotiation information into the lease database. Additionally, thecomputer can “lock in” the agreed items to prevent modification byeither party. The result of phase two is a revised lease proposal withthe agreed changes, which the computer generates upon command based onthe revised negotiation information.

Once the parties have successfully completed the first and second phasesof the negotiation, the computer system will allow them to proceed tothe third negotiation phase. It should be understood that additionalcomputer screens corresponding to the steps in FIG. 5 and the succeedingnegotiation phases can be provided, although none are illustratedherein.

The third negotiation phase (agreement on lease deliverables) will bedescribed with reference to FIG. 5. It will be appreciated that althoughsome of the steps shown in FIGS. 5 through 11 appear to repeat some ofthe lease provisions that were the subject of an earlier negotiationphase, in practical terms any lease provision that was the subject ofcomplete agreement in an earlier phase would be removed from laternegotiation phases.

Beginning with FIG. 5, in step 501 the parties agree upon a checklist(e.g., condition of the premises, furnishings, network systems, etc.).If these were already agreed to in an earlier negotiation phase, thecomputer would delete them from a later phase. In step 502, the partiesagree upon the condition of the premises, indicating whether thepremises will be delivered “as is,” or with turnkey modifications orwith other modifications. In step 503, if LSP intervention is needed, itis selected as described above. In step 504, the parties agree upon thefurnishings (e.g., cafeteria equipment, furniture, etc.). In step 505,the parties agree upon a network system, and in step 506 they agree on atelecommunications system (using if necessary an LSP as per step 503).In step 507, the parties agree upon a summary document including theagreed deliverables and a completed lease proposal including schedule.

In one variation of the invention, a schedule calculator (FIG. 1A,element 111) calculates a proposed schedule corresponding to milestonesduring the negotiation and execution phase, based on average actuallengths of time stored in a database. In one variation, the lengths oftime stored in the database are based on or derived from previouslynegotiated contracts (i.e., real-world practice is used to projectfuture schedules). For example, if over the course of five differentnegotiated leases the average amount of time needed to go fromgenerating a draft lease to moving into the leased property is twomonths, the scheduler would use that value to schedule such a milestonetwo months before the lease move-in date. The computer displays andprints a lease negotiation and execution schedule based on informationprovided by the parties and from databases of previously negotiatedleases. FIG. 18 shows a computer-generated schedule for each phase of anine-phase lease negotiation and execution process.

The fourth phase (define tenant environment) will be explained withreference to FIG. 6. In step 601, the parties (including the tenant andits local service providers) agree upon a tenant's checklist. This caninclude an agreement on a floor plan, furniture needs and costs, and LHI(leasehold improvement) cost. Steps 602 through 607 are similar innature to the other steps already discussed (i.e., the parties eitheragree or defer agreement on each item, and can resolve areas ofdisagreement using LSPs or other options). The result of negotiation inphase four is the issuance of a summary document including a checklistof outstanding tenant environment needs; a modified lease proposal; anda revised schedule (if necessary).

The fifth phase (agreement on legal documents) will be described withreference to FIG. 7. In step 701, the parties agree to requireintervention by LSPs (e.g., lawyers) if necessary. In step 702, a draftcontract (lease) is generated by the computer on the basis of thenegotiated information that was “locked in” by agreement of the parties.This step can be done using a document template populated withinformation from lease database 104. In step 703, the parties review andresolve the contract, including mediation if necessary. In step 704, theparties agree upon lease attachments such as a detailed description ofoffice space, final plans and specifications. In step 705, a leaseagreement is prepared. The result of the fifth phase is a lease that theparties agree on (but which has not yet been executed).

The sixth phase (obtain approvals and execute documents) will beexplained with reference to FIG. 8. In step 801, information summariesare prepared. If a corporate approval summary is required, a standardcorporate approvals form is generated using information from the leasedatabase. If a financial analysis is required, a standard financialanalysis form is generated. In step 802, corporate approvals areobtained by each party. This includes steps of submitting the forms andinformation for internal approvals, obtaining signatures of localsubsidiaries if required; and obtaining management signatures on theapproval forms. In step 803, the legal documents are executed. This mayinclude steps of identifying authorized signatories; transmittingoriginal signature documents by e-mail, fax or express mail, andobtaining the actual signatures. In step 804, the parties exchangedocuments, pay required deposits, and exchange keys or other entrancemechanisms (security codes, etc.) The outcome of this phase is that alllegal documents are executed and access is granted to the premises.

The seventh phase (complete lease deliverables) will be explained withreference to FIG. 9. In step 901, the current occupier vacates thepremises (if it has not already done so). In step 902, the landlordcompletes the leasehold investment required under the lease. In steps903 and 904, the network and telecommunication systems are delivered inaccordance with the lease. In step 905, the furniture is delivered andaccepted. Any works for which the landlord is not responsible would beeliminated as decisions in this phase.

In step 906, the tenant formally accepts all of the above deliverables(to the extent that these were not accepted in the preceding steps);this may include steps of inspecting the premises, rectifying defects orvariances, and providing a summary of delivered items.

The eighth phase (complete tenant works) will be explained withreference to FIG. 10. The steps shown in FIG. 10 relate to works thatthe tenant is completing without assistance of the landlord. As such,the decisions in this phase involve only the tenant and its LSPs(although, in practice, the tenant may require the landlord'scooperation to resolve issues related to installation of tenant systemsin the premises). Any steps that are completed by the landlord on behalfof the tenant in phase seven would be automatically eliminated fromphase eight. Once all of the tenant's works are completed, the tenantwould move into the new premises.

The ninth phase (issue best practice report) will be explained withreference to FIG. 11. In this phase, the parties review the negotiationprocess for evaluation purposes, particularly with a view to building adatabase that can be used by parties in future negotiations. In step1101, the final schedule is reviewed and accepted with comments. Thefinal schedule will show the variation between the initial and actualschedules, and the computer will prompt the parties to indicate thereasons for the variances. In step 1102, the parties evaluate LSPs thatwere used during the negotiation process (e.g., mediators, architects,lawyers), and the evaluation information is stored in a database. Instep 1103, a best practice questionnaire is completed by each party. Thequestionnaire may include questions soliciting successes; problem areasidentifying locality-specific difficulties encountered during theprocess (e.g., difficulties in completing legal documents in London);and improvement suggestions. The results are stored in a computerdatabase. Finally, in step 1104 a best practice report is generated andstored in a database. In one variation, the best practice report isgenerated using a document template that extracts answers to questionsand information from the lease negotiation process. The report can beviewed by parties to a future negotiation to help in a transaction.

FIG. 16 shows a computer-generated lease proposal that can be filled inby one or both of the parties. In one variation of the invention, if theparties have already begun discussions, they could use a form such asthat shown in FIG. 16 to enter information regarding the proposalwithout having to go through a more detailed agree/defer processillustrated in FIGS. 13 through 15.

Continuation-In-Part Improvements

Although the above-described structured negotiation process and systemhas wide applicability to various types of contracts and real estatetransactions including leases, sales, and others, the following setsforth in further detail various improvements to the principles outlinedabove. These improvements concern the following features:

-   (1) rules-based agreement on negotiator-supplied terms (response and    dialogue box);-   (2) delegation to transaction team members or service providers;-   (3) summary reports with link to messaging system;-   (4) dual messaging system;-   (5) customized negotiation process; and-   (6) sale-specific features.    Each of these features is explained in more detail below.    1. Rules-Based Agreement on Negotiator-Supplied Terms

The system described above allows each party to the negotiation to enterancillary information (e.g., a proposed delivery date or monthly rent)that is then evaluated by the computer to identify a discrepancy (e.g.,if each party has proposed a different value) and to propose a solution(e.g., the computer can propose splitting the difference between twonumerical values). Additionally, the system described above allows eachparty to “write over” the other party's proposed ancillary information,wherein the computer flags any overridden values and alerts the otherparty of the changed value. The system described above also allows eachparty to enter a value and the computer will recognize agreement if thevalues entered by both parties are the same.

In some situations, values entered by negotiators may not be simplenumeric quantities (e.g., a monthly rent or a sale price). Some contractterms may involve a paragraph or two of legal text explaining theparties' understanding of a particular contract term (e.g., what itmeans to have “fully functioning plumbing”), or may involve other morecomplicated terms. Some of these provisions may need to be negotiatedover a period of time, such that it is not practical for a party tomerely enter a number or type in a sentence. In such situations, a moreelaborate dialogue box approach may be warranted.

According to one inventive improvement, each party to the negotiation isprovided with a separate dialogue box into which certain proposedcontract terms can be provided. As shown in FIG. 13A, a web-basedcomputer screen is presented to the parties to a transaction. For eachcontract provision, each party is provided with an agree/defer mechanism(e.g., selection items 1308 and 1310); a response box (1357 and 1309)and a dialogue box (1356 and 1350). According to this variation of theinvention, each party controls its own agree/defer selection and its ownresponse and dialogue box, but is prevented by the computer from typinginto those portions of the other party's display areas. However, eachparty can see what the other party has typed into these respectiveareas, such that each party is aware of the other's negotiatingposition.

In general, each party should respond to each decision by (a) making anentry in the response box but not in the dialogue box; or (b) making anentry in the response box and an entry in the dialogue box; or (c)making an entry in the dialogue box but not in the response box, andthen (subject to the restrictions below) selecting either Agree orDefer.

In one variation of the invention, the system will accept an Agreeresponse from both parties, and lock in a decision, only if the partiesrespond as per alternative (a) or (b) above, and provided that entriesin the response box for both parties, and entries in the dialogue boxfor both parties, are identical. If one party wishes to accept thecomment in the other party's dialogue box, they may simply enter theword “accept” in their dialogue box, and the system will assume that thecomments are identical. The computer will not accept an “Agree” responseunder alternative (c).

The system will accept a Defer response from both parties underalternative (a), (b) or (c) above. It is not necessary for the entriesin either the response box or the dialogue box to be identical. If oneparty enters “Agree” and the other party enters “Defer”, the system willassume that no decision has been made, and that this phase in theprocess is therefore not complete. The system will prompt the parties toreach an Agree or Defer decision. If one party makes an entry in anAgree/Defer box and the other party does not, the system will prompt theother party to make an entry.

As shown in FIG. 13A, the landlord has entered 5000 square feet as theleased space in response box 1309, and has indicated in dialogue box1350 that the space measurements exclude closet space. The prospectivetenant has entered “accept” into response box 1357 and “accept” intodialogue box 1356, and has selected Agree. Consequently, the rules-basedcomputer processing would lock in this lease provision based onagreement of the parties. As another example, if the tenant wrote“usable space” in the dialogue box corresponding to the leased space,but the landlord wrote “rentable space” into the landlord'scorresponding dialogue box, the computer would not allow the parties toselect Agree. In another variation, however, the computer would flag thediscrepancy and generate a report indicating that the parties had notagreed on the provision at issue.

Also as shown in FIG. 13A, the landlord has indicated in dialogue box1351 that a particular plan of the space will be used, but the tenanthas indicated in selection 1353 that this decision is to be deferred.Therefore, the rules-based computer processing would defer this leaseprovision based on the tenant's decision to defer or, in one variation,generate a message to the landlord asking if they wished to also deferthis decision or, in a further variation, ask the tenant if they wishedto accept the landlord's comment. When the parties have entereddiffering “Agree”/Defer” decisions, the system can prompt the parties tohave matching decisions. For example, if party A entered “Agree” andparty B entered “Defer”, the system would prompt B with a message askingB to review its decision to make sure it is correct. If there were nochange to B's decision, the system would deliver a message to party Aadvising that there is a discrepancy, and asking A to review itsresponse. If party A makes no changes, the system would then promptparty B again, and so on until the decisions match. There are obviouslymany other rules and approaches that could be used to carry out theinventive principles.

Both parties have indicated in dialogue boxes 1354 and 1355 that anoccupancy date of Dec. 1, 2001 is to be used, and have indicatedagreement on this provision. The computer-implemented rules would detectthat both parties had entered the same date in these dialogue boxes, andwould lock in this lease provision accordingly.

In another variation, the parties could agree at the start of theprocess to exclude any dialogue box comments as part of the decisionmaking process. In yet another variation, the parties could be promptedby the computer as to whether they would accept the Agree choice withouttaking into account the dialogue box comments. Many other variations areof course possible.

In a further variation, the system could note on a higher level screenall decisions reached by the parties on a web-based computer screen suchas that shown on FIG. 13A, such that the parties do not do not need torecord these summary agreements themselves. For example, if one leaseprovision includes several lower-level decisions that are made using alower-level screen made up of various sub-decisions, the computer can beprogrammed to recognize that agreement has been reached on all of thelower-level sub-decisions and reflect a “rolled-up” agreement at ahigher-level screen. This would avoid the need for the parties toexplicitly indicate that agreement had been reached on all lower-leveldetails pertaining to a particular lease provision or phase of thenegotiation process.

2. Delegation to Transaction Team or Service Provider

According to another aspect of the invention, negotiators to atransaction can designate members of their transaction teams or serviceproviders, such that different aspects of a negotiation can be handledby different authorized entities. According to this aspect of theinvention, the parties can identify a person responsible for eachdecision and, optionally, the role played by that person (e.g.,architect, broker, attorney, real estate agent). These persons may beemployed by the parties (e.g., a user group representative or projectmanager for a tenant), or they may be an external service provider(e.g., a broker for the landlord). By nominating and registering thesepersons, they can (subject to permissions granted by the parties)participate directly in the decision-making process; can print outreports; and can send and receive messages among other members of thenegotiating team.

In the context of a real estate lease negotiation, the prospectivelandlord and tenant, who are identified at the beginning of thetransaction, have the capability to designate and modify members of thetransaction team. Members can be designated based on different phases ofthe negotiation (e.g., one person handles Phase I negotiations, whereasa different person handles Phase II negotiations), or they can bedesignated based on particular functions (e.g., an architect could bedesignated to handle office space planning, whereas a broker could bedesignated to handle space and price requirements or they can bedesignated to handle specific decisions within a particular phase).

FIG. 20 shows a web-based computer screen that can be used to allow eachcontract negotiator to designate members of the negotiating team. Asshown in FIG. 20, the tenant has designated a company (Realtor Plus)2001 and a user (Jack Realtor) 2002 to handle the tenant's negotiationof the Agree Lease Proposal and Schedule terms of the negotiation.Additionally, the role played by this person is indicated as real estateagent (see box 2003). Similarly, the landlord has assigned a differentcompany and person to handle negotiations on its behalf. Based on thesedesignations, the system would permit Jack Realtor to log into thesystem and negotiate this specific lease provision on behalf of thetenant, and would permit Bob Worker to log into the system and negotiatethis specific lease provision on behalf of the landlord. The rolesassigned to each person can be selected from a pull-down menu and areused by the system (as described below) to allow team members tocommunicate based on roles.

The tenant has similarly designated Steve Smart of Brokers Plus tonegotiate outstanding business issues, as indicated at 2004 and 2005 inFIG. 20. This person's role is contract manager, as indicated at 2006.The landlord, however, has assigned himself to be responsible for thisphase. Finally, the tenant has designated Susan Smith of Office Plus tonegotiate the landlord lease deliverables on behalf of the tenant.

Based on the designations made by each party (e.g., tenant andlandlord), different team members would be permitted to log into thesystem and negotiate only those contract provisions for which they hadbeen given authorization. Access could be restricted to other parts ofthe system (e.g., reviewing bids from competing service providers orother proprietary information) where the service provider does not needdetailed information to complete its assigned tasks.

In a further variation, a party may delegate partial decision makingauthority to a service provider by permitting this person to utilizecertain preformatted and/or dialogue boxes (such as shown in FIG. 13A)while reserving for itself the making of the Agree/Defer choices tofinalize each decision. The format (such as indicated in FIG. 13A) forthis joint decision-making process would permit the party to quicklyidentify these choices. For example, suppose that Company A has asubstantial leased real estate portfolio and a small in-houseprofessional staff. It delegates much of the transaction work to thirdparty providers such as brokers and project managers. However, on largertransactions management wishes the in-house professionals to be directlyinvolved in the negotiations. To satisfy this demand, the system wouldpermit the party to assign service providers control over the middleportion of certain screens (i.e., the pre-formatted and non-preformattedfields and dialogue boxes). Once the provider had completed itsnegotiations, the party would simply follow down the column and click“agree” or “defer” to each provision, at which point the computer couldlock-in decisions if the other party (using the same dual approach or adifferent approach) had done likewise.

In another variation of the above-described principles, decision-makingcan be allocated between a transaction party and the party's serviceprovider by decision-making level. This permits a party to delegate theauthority for negotiating detailed terms and conditions on lower-levelscreens through use of the preformatted choices and dialogue boxes, butto reserve the final agree/defer decision to the party itself on ahigher level screen such as the screen displayed in FIG. 13.

In another variation, a general override provision can be included toallow a party to change any decision that his or her service providerhas made (thus in some cases “unlocking” decisions).

3. Summary Reports With Link to Messaging System

A third improvement to the system outlined above is the ability toprovide a summary report with a linkage to a messaging system (e.g., ane-mail service) for each transaction party. As shown in FIG. 21, aplurality of transactions are shown in summary form. Pertinent detailsfrom each transaction or lease are listed on a single line, and acurrent contact 2101 is shown in hyperlink form. The current contact maybe the tenant, landlord, or a person who is designated to be responsiblefor this phase of the transaction. A user of the system can click oncurrent contact 2101 and be presented with a message transmissionscreen, such as that shown in FIG. 22. Messages can be transmitted usingany of various commercially available e-mail programs, or usingcustom-developed software.

As shown in FIG. 22, the message transmission screen is pre-populatedwith the name of the current contact for the landlord or tenant. Theuser of the system (which may comprise one of the individuals designatedto act on behalf of one of the parties or company executives withresponsibility for real estate transactions who are registered) can senda message to the current contact 2201 concerning a subject 2202 and amessage 2203. An attachment 2205 can be provided (e.g., a draft of anoffice layout or other document) and sent 2204 to the current contact.This feature allows users to quickly and easily identify the currentcontact along with pertinent details of a particular lease transaction,which especially benefits busy executives in need of a timely responseto questions.

In one variation, messages can be sent to team members based on role,rather than contact name. Thus, for example, once a tenant hasdesignated an architect to act on his or her behalf to handle one ormore aspects of the lease negotiation, the report refers to the contactperson by function rather than by user name, and others in the systemcan send a message to the person having that role merely by indicatingthat person's role. Turning to FIG. 23, for example, the messagingsystem includes a recipient field 2301 including a pull-down menu withchoices corresponding to those roles that have been registered with thesystem. For example, a user can send a message to the architect or realestate representative by selecting one of those roles withoutremembering the person's name or system contact details, and the systemwill correlate that role with one or more specific e-mail addressesbased on previous registrations within the system. In another variation,a real estate broker could send an e-mail to all architects (includingthose acting on behalf of the tenant and the landlord) by selecting“architect” as the recipient. The system would look up all personshaving the role “architect” for the particular transaction and send thee-mail message to all such persons.

FIG. 24 shows another variation of a summary report, breaking outvarious information (including schedule information and current contactpersons) for each phase of a transaction. This report can be retrievedby selecting details button 2102 in FIG. 21. The report shown in FIG. 21includes different contacts for each phase of the lease negotiation,with hyperlinks to each allowing messages to be sent to them.

4. Dual Messaging System

Yet another improvement relates to a feature wherein a user can elect tosend a message that is not posted in a message log visible to allmembers of the transaction team. FIG. 25 shows a message log showingmessages that have been sent to parties negotiating a real estatetransaction. In one embodiment of the invention, messages transmittedamong all parties (including delegated participants) are recorded insuch a message log. This message log allows all users to view messagesand attachments that have been transmitted among the participants.

Sometimes, however, it may be desirable to send a message to one personin the group of people negotiating the contract without allowing othersto view the message. According to one aspect of the invention, thesender of a message can indicate, such as by specifying a privatedesignator 2206 (see FIG. 22), that the message should not be posted tothe message log viewable by other transaction team members. Thecomputer-implemented system of the present invention inhibits theposting of such messages to the message log, such that they do notappear in the display of FIG. 25. These messages would be transmittedinstead to a separate mailbox for viewing only by each recipient.

The messaging and reporting systems are designed to generally facilitatecommunication and relay information during a transaction. However, mostof this contact will be within each transaction team rather than betweenthe two teams. It is contemplated that most of the contact between thetwo transaction parties would take place through the detailed screens,allowing of course for other means of communication. Accordingly, in onevariation there can be two separate reports with respective contactpersons for each party. For the dual messaging system, the system wouldfunction the same way: both parties would have his or her own messagelog, which would not preclude messages passing and being logged betweenparties. All messages within each team would be displayed, unless a teammember opted to send a private message. Messages between teams wouldfollow the same rules.

5. Customized Negotiation Process

The structured lease negotiation process as described herein isgenerally contemplated to cover transactions applicable to a widevariety of tenants, landlords, and others. It may be desirable, however,to permit parties to customize the negotiation process for a particularsituation. For example, the process can be simplified by removingdecisions that are not required by the parties to complete atransaction. Two different methods can be employed to accomplish thisresult.

In a first variation, a “customize lease” function is provided, allowingthe party originating the transaction at the beginning of the process toclick through a number of pre-formatted boxes to decide whether all ofthe standard decisions under Phase I (Agree Lease Proposal and ConfirmSchedule) are applicable or non-applicable. For example, if there wouldbe no “landlord's works” in the leased premises, this display screen andconnected lower-level display screens related to specifying thelandlord's works would be removed. Further, any related screens thatwould normally appear in subsequent phases of the process (e.g.,completion of landlord's works) would also be removed. The other partynot responsible for this customization process would be able tochallenge any decisions deemed non-applicable, and the parties couldagree to reinstate these decisions. In one variation, the “customizelease” function could be applied directly to all aspects of the processand not just to Phase I (this would primarily influence tenant-onlydecisions in Phase IV and VIII where the tenant is specifying and thencompleting its own works in conjunction with its own local serviceprovider or project manager).

In a second variation, under the “Checklist” functions displayed inPhase III and IV, the parties may at specified intervals (e.g., defininglandlord's works and tenant environment) agree to eliminate decisionsthat are not part of a negotiation, or are the tenant's responsibilityunder the lease, or which the tenant does not wish to address throughthis system. For example, if the tenant is providing the network system,this decision can be removed from landlord's works. The checklists alsopermit the parties to reconsider other aspects of the transaction as thenegotiations continue and the roles and responsibilities become clear,and permit the tenant to re-evaluate its needs for improvements in thepremises in those phases that do not involve the landlord. This wouldinclude, for example, restoring decisions that had been eliminated aspart of the initial customization process.

These customization methods assure the parties that they will not expendunnecessary effort on screens and decisions that are irrelevant, andthat corporate real estate representatives are not drawn into decisionmaking for which they are not responsible and/or which the company wouldadminister outside of the system. This also eliminates “downstream”decisions that would otherwise be redundant and permits the parties toadjust the decision making process as agreements are reached and newinformation becomes available.

It should also be apparent that customization can be based on broaderuser-specific needs, including for example different phases; differentscreen formats; milestone decisions; documentation and reportinterfaces; and messaging interfaces.

6. Sale-Specific Features

Although the principles of the invention have been described primarilyusing the example of a real estate lease transaction, the invention canalso be tailored to address a real estate sale transaction. Thisvariation employs the above-described phased negotiation systemincluding agreement/deferral decision-making processes, but withadditional features that facilitate a sale transaction. The term “buyer”and “seller” in this variation should be understood to include agentsacting on behalf of a buyer and seller respectively. Similarly,references in the figures and above description to “tenant,” “landlord,”and “lease” should be understood to refer to “buyer,” “seller,” and“sale” in the context of this variation of the invention.

FIG. 26 shows a computer display screen depicting a nine-phasenegotiation process for consummating a real estate sale between a buyerand a seller. The negotiation process is divided into nine phases,although of course the number of phases and the contents of each phasecan be rearranged or varied without departing from the inventiveprinciples. As shown by way of example in FIG. 26, the phases includethe following:

(1) confirm business terms and schedule

(2) resolve outstanding business issues

(3) agree on seller's deliverables and buyer's conditions

(4) finalize purchase and sale document

(5) obtain approvals and sign contract

(6) complete buyer's due diligence

(7) complete seller's works and deliverables

(8) complete transaction and closing

(9) issue best practice report

As shown in FIG. 26, in one variation each phase is presented on a webpage with an associated hyperlink (indicated by underlining in FIG. 26),such that each party to the negotiation can select a phase in order toproceed to making decisions regarding that phase. A field 2601 isprovided to allow each user to enter a project or transaction numbercorresponding to a previously-started project or transaction, and thecomputer-assisted process retrieves from a file or database informationrelating to the previously-started transaction.

FIG. 27 shows a web page corresponding to user selection of the firstphase (i.e., confirm sale proposal or business terms and schedule). Theuser is presented in FIG. 27 with a series of decisions 2701 through2709 that are to be made in the course of negotiating a sale proposaland schedule. In particular, the parties are each asked to either agreeor defer (indicated by choices 2712 and 2711) on each decision,including decisions regarding a sale price (decision 2701); dispositionof assets (2702); structure of the transaction (2703); payment terms(2704); other conditions to sale (2705); deposit (2706); closing date(2707); schedule (2708); and sale proposal (2709). In one variation,clicking on a decision results in presentation of a help screen to theuser that provides an explanation of the decision and how it can be madeor deferred until a later phase.

Additionally, by clicking on a details link 2713, the user istransferred to web page (e.g., FIG. 28) that contains additional detailsof the decision pertaining to the link. For example, as seen in FIG. 28,each user is invited to agree on a currency, fixed or variable price,conditions for variable price, and other parameters. As before, thebuyer and the seller can each select either agree or defer for eachdecision. If both parties agree on a particular decision, that decisionbecomes “locked-in” in the computer for the remainder of the negotiationprocess, whereas a party selecting deferral of a decision causes thedecision to be deferred to a later phase, where it can be revisited. Forcertain decisions, a free-form text/dialogue box can be provided for theparties to enter text describing the substance of the agreed decision.For example, for the decision relating to description of assets (element2702), the users can be provided with a text box into which one of theparties enters a detailed description of the real estate property. Forother decisions, parameterized fields can be provided for suchquantifiable terms as sale price, closing date, and the like. In aslightly different variation, the dialogue boxes shown in FIG. 28 can beimplemented like those shown in FIG. 13A, and other variations are ofcourse possible without departing from the inventive principles.

Returning to FIG. 27, decision 2702 may include terms relating tospecification of buildings; land; building improvements; leasedproperties; acquired properties; and other elements.

Decision 2703 may include terms relating to direct sale of assets;direct transfer of a leasehold interest; sale of a company; sale of apartnership or similar entity; and allocation of ownership interests.

Decision 2704 may include terms relating to payment in cash; payment inshares; and payment in installments.

Decision 2705 may include terms relating to condition of assets; legaldocumentation; mortgage financing; obtaining permits/approvals; andrequiring local service provider (LSP) intervention.

Decision 2706 may include terms relating to contingent deposits; timingof payment; and specifying currency.

Decision 2707 may include terms relating to fixed or variable closingdates, among others.

Decision 2708 may include terms relating to binding or non-bindingschedules; requiring LSP intervention; and a draft schedule.

Decision 2709 may include terms relating to binding or non-bindingletters of intent; requiring LSP intervention; and agreement on a draftletter of intent.

Also as shown in FIG. 27, an option 2710 is provided for viewing a draftsale proposal. When selected by a buyer or seller, a draft sale proposalsuch as that shown in FIG. 37 is presented, populated with informationrelated to the presently-agreed sale terms.

FIG. 29 shows decisions pertaining to a second phase of a salenegotiation (resolve outstanding business issues). In this phase, theparties are invited to resolve outstanding business issues, such aspayment terms. The parties may agree on a resolution method; select alocal service provider (e.g., an appraiser or attorney); resolve anissue with the LSP; resolve without an LSP; and agree on summarydocuments. In one variation of the invention, the parties are preventedfrom proceeding to the next phase of negotiation until all outstandingbusiness issues have been resolved. In another variation, the partiesmay defer certain decisions to later phases.

FIG. 30 shows a web-based computer screen corresponding to a third phaseof the sale negotiation process (agree on seller's deliverables andbuyer's conditions). In this phase, the parties are invited to agree onor defer decisions involving terms such as deliverables, due diligenceconditions, and others.

FIG. 31 shows a web-based computer screen corresponding to a fourthphase of the sale negotiation process (agree on purchase and salecontract). In this phase, the parties are invited to agree on or deferdecisions involving terms such as local service providers, draftcontracts, and additional documents.

FIG. 32 shows a web-based computer screen corresponding to a fifth phaseof the sale negotiation process (obtain approvals and sign contract),including options for agreeing on or deferring decisions relating toterms associated with this phase.

FIG. 33 shows a web-based computer screen corresponding to a sixth phaseof the sale negotiation process (complete buyer's due diligence),including options for agreeing on or deferring decisions relating toterms associated with this phase.

FIG. 34 shows a web-based computer screen corresponding to a seventhphase of the sale negotiation process (complete seller's works anddeliverables), including options for agreeing on or deferring decisionsrelating to terms associated with this phase.

FIG. 35 shows a web-based computer screen corresponding to an eighthphase of the sale negotiation process (complete transaction andclosing), including options for agreeing on or deferring decisionsrelating to terms associated with this phase.

FIG. 36 shows a web-based computer screen corresponding to a ninth phaseof the sale negotiation process (issue best practice report), includingoptions for agreeing on or deferring decisions relating to termsassociated with this phase.

Thus has been described a system and method for negotiating a contract,such as a real estate transaction, using a computer network. Theinvention has broad applicability and scope beyond real estatetransactions, and can be applied more generally in any contractnegotiation setting, such as a corporate procurement contract or acontract related to supply-chain management applications. The inventiveprinciples can be practiced using an intranet, extranet, wirelessnetwork, 3G systems using GSM and other technologies.

Reference numerals in the appended method claims identifying steps arefor convenience only and are not intended to imply a necessary orderingof the steps. It is, therefore, to be understood that within the scopeof the appended claims the invention may be practiced otherwise than asspecifically described. No claim should be interpreted to be inmeans-plus-function format.

1. A computer-assisted method of negotiating a contract over a computernetwork, comprising the steps of: (1) in a computer, receiving from afirst contract negotiator information designating, for each of aplurality of contract phases, information identifying a person or entityhaving authority to negotiate a corresponding contract phase, and a roleplayed by that person or entity; (2) permitting each person or entityhaving authority for negotiating each respective contract phase to loginto the computer and to negotiate with a second negotiator using thecomputer, wherein the computer displays on a first computer screen aplurality of predefined contract provisions, each relating to a contractprovision contained within one of the corresponding contract phases andincluding an agree/defer selector for a first negotiator and anagree/defer selector for a second negotiator; and (3) denying persons orentities not authorized in step (1) from negotiating with the secondnegotiator.